Does intraday technical trading have predictive power in precious metal markets?

Jonathan A. Batten, Brian M. Lucey, Frank McGroarty, Maurice Peat, Andrew Urquhart

Research output: Contribution to journalArticleResearchpeer-review

10 Citations (Scopus)

Abstract

Previous research has identified that investors place more emphasis on technical analysis than fundamental analysis, however the research has largely been confined to daily data and stock market indices. This paper studies whether intraday technical trading rules have any significant predictive power in the precious metals market through three popular moving average rules. We find that using the standard parameters previously used in the literature, technical trading rules offer no predictive power whatsoever. However after utilising a universe of parameters, we find a number of parameter combinations offer significant predictability in the gold market, but there remains no significant predictability in the silver market. Our results show that the longer parameters of the technical trading rules are more successful than the traditional parameters chosen in the literature. Therefore intraday technical trading rules have some predictive power in the gold market but offer no significant predictability in the silver market.

Original languageEnglish
Pages (from-to)102-113
Number of pages12
JournalJournal of International Financial Markets, Institutions and Money
Volume52
DOIs
Publication statusPublished - Jan 2018

Keywords

  • Gold
  • Precious metals
  • Predictability
  • Silver
  • Technical analysis

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